FI Morning Grain Comments 08/20/21

PDF Attached

 

Good
morning.

 

USDA’s
24-hour sales streak ended today.  https://www.fas.usda.gov/newsroom 
The CBOT complex is mixed on lack of direction.  Global vegetable oils appreciated overnight but soybean oil is struggling amid a lower trade in WTI crude oil.  Corn and Chicago wheat are lower.  KC is lower on harvest pressure.  MN is higher on higher Paris
wheat. 

 

Pro
Farmer projected higher corn yields for Iowa (190.76) and higher soybean pod counts than last year and the 3-year average.  Implied corn production for IA is slightly below USDA.  For Minnesota, the tour pegged the corn yield sharply lower than last year and
3-year average and pod count lower than 2020 and average.  Final tour results will be released around the close  (1:30 PM CT they issued in 2020). 

 

 

 

 

We
look for corn conditions to decline 1 in the combined good and excellent categories, and soybeans to remain unchanged.  At 61 and 57 for corn and soybeans respectively, if realized, they both would be at a season low.  Since more than 50 percent of the spring
wheat crop had been collected, USDA will not issue a crop progress update.  Spring wheat G/E last week settled at 11 percent.  Note the range this season was 9 to 45 percent, 45 at the beginning of the season.  September MN rallied about $1.43 since April
30. 

 

 

 

Weather

 

 

WORLD
WEATHER INC.

WORLD
WEATHER HIGHLIGHTS FOR AUG. 20, 2021

• Hurricanes
  will be the center of this weekend’s weather stage with one damaging crops and property in Veracruz, Mexico and the other impacting the U.S. New England States.
  
• Significant
  rain will fall this afternoon into Saturday with a little follow up rain Sunday into Monday in the Northern Plains favoring North Dakota and Manitoba, Canada.
  
• Rain
  will also fall in western Iowa this weekend while areas to the east in the central and eastern U.S. Midwest are left dry until the second half of next week when showers and thunderstorms slowly begin.
  
• No
  changes overseas today except in eastern Europe and the western CIS where some increase in precipitation is expected as cooler air pours into those areas.
  
• China
  and India will remain plenty moist with a few showers expected in northwestern India, as well.
  
• Southern
  Queensland and northern New South Wales may get some showers late Sunday into Tuesday morning, but the resulting rain will be light. 
• Some
  increase in Ivory Coast and Ghana rainfall is expected in the next couple of weeks
• Argentina
  will remain dry biased especially in western wheat areas
• Southern
  Brazil will get some rain periodically
• Western
  Europe will be dry and warm biased for a while including France
• The
  Balkan Countries may get some rain in the second half of next week as cooling evolves

Source:
World Weather Inc. 

 

 

Bloomberg
Ag Calendar

Friday,
Aug. 20:

• ICE
  Futures Europe weekly commitments of traders report (6:30pm London)
• CFTC
  commitments of traders weekly report on positions for various U.S. futures and options, 3:30pm
• China’s
  country-wise import data for farm goods such as soybeans, corn and pork
• FranceAgriMer
  weekly update on crop conditions
• Malaysia
  Aug. 1-20 palm oil export data
• U.S.
  Cattle on Feed, 3pm

Monday,
Aug. 23:

• USDA
  export inspections – corn, soybeans, wheat, 11am
• U.S.
  crop conditions – corn, cotton, soybeans, wheat, 4pm
• Monthly
  MARS bulletin on crop conditions in Europe
• Ivory
  Coast cocoa arrivals

Tuesday,
Aug. 24:

• EU
  weekly grain, oilseed import and export data
• U.S.
  poultry slaughter

Wednesday,
Aug. 25:

• EIA
  weekly U.S. ethanol inventories, production
• Malaysia
  Aug. 1-25 palm oil export data
• Unica
  cane crush, sugar production (tentative)

Thursday,
Aug. 26:

• USDA
  weekly crop net-export sales for corn, soybeans, wheat, cotton, pork, beef, 8:30am
• International
  Grains Council monthly report
• Port
  of Rouen data on French grain exports

Friday,
Aug. 27:

• ICE
  Futures Europe weekly commitments of traders report (6:30pm London)
• CFTC
  commitments of traders weekly report on positions for various U.S. futures and options, 3:30pm
• FranceAgriMer
  weekly update on crop conditions

Source:
Bloomberg and FI

 

 

 

 

 

Macros

 

Corn

·        
Corn is lower on end of week positioning and lack of US export developments.  Cattle on Feed will be released after the close.  USD is at a 9-1/2 high against a basket of currencies. 

·        
Pro Farmer projected higher corn yields for Iowa (190.76) and higher soybean pod counts than last year and the 3-year average.  Implied corn production for IA is slightly below USDA.  For Minnesota, the tour pegged the corn yield
sharply lower than last year and 3-year average and pod count lower than 2020 and average.  Final tour results will be released around the close  (1:30 PM CT they issued in 2020). 

• EPA
  reported about 1.27 billion ethanol (D6) blending credits were generated in July, same amount as June. 
  

 

Export
developments.

• South
  Korea’s FLC bought 66,000 tons of corn at $319.99/ton for Sep 13-Oct 12 shipment. 
  
• Results
  awaited:  Qatar seeks about 100,000 tons of barley on August 18 for Sep-Nov delivery. 
  
• Turkey
  seeks 270,000 tons of barley on August 20 for shipment between Sep 1 and Sep 25. 
  

 

 

Soybeans

·        
The CBOT complex is mixed on lack of direction.  Global vegetable oils appreciated overnight but soybean oil is struggling amid a lower trade in WTI crude oil.  The US weather forecast is non-threatening. 

·        
USDA 24-hour sales streak ended today. 

·        
Malaysian palm oil were up 27 points to 4,265 and cash was up $2.50/ton at $1,067.50/ton. 

·        
Cargo surveyor SGS reported month to date August 20 Malaysian palm exports at 781,291 tons, 88,251 tons below the same period a month ago or down 10.1%, and 109,152 tons below the same period a year ago or down 12.3%.

·        
China crush margins improved on Friday and are higher from the previous week. 

·        
China soybean complex futures trended lower led by soybeans.  

·        
Offshore values are leading soybean oil 137 points higher (167 higher for the week to date) and meal $2.40 higher ($0.60 lower for the week). 

·        
Rotterdam vegetable oils were 2-7 euros higher and meal 2-4 euros lower. 

·        
Malaysian palm oil

·        
China cash crush margins were last positive 110 cents on our analysis (previous 89) versus 87 cents late last week and also 87 cents around a year ago. 

·        
China

·        
EPA reported about 356 million biodiesel (D4) blending credits were generated during July, down from 429 million during June. 

 

Export
Developments

·        
Results awaited: South Korea’s Agro-Fisheries & Food Trade Corp. seeks 3,700 tons of non-GMO soybeans (August 19) for arrival between Oct. 20 and Nov. 19.

·        
Yesterday Egypt’s GASC got one offer in sunflower oil tender at 1,336 a ton c&f, and they bought 10,000 tons.  There were no soyoil offers.  This is for arrival Oct 5-25.  Payment is for 180-day letters of credit or at sight. 
Last GASC tender for sunflower oil was 6/22 for 10K @ $1133/ton.  Prior to that was on June 8, GASC paid $1368/ton for combined 40k tons of sunoil. 

 

Wheat

·        
Wheat is mixed with Chicago and KC (harvesting pressure) lower and MN higher following a higher trade in Paris wheat.  We are hearing more chatter over EU wheat quality problems. The US upper Great Plains will see good rain by
the end of this weekend. 

·        
France is 91 percent complete with soft wheat harvesting, up from 72% week earlier. 

·        
EU December wheat was up 3.50 euros at $247.25 at the time this was written.  September was up 10.00 euros. 

·        
The Euro is near a November 2020 low. 

·        
Ukraine is nearly complete with their wheat harvest.  Ministry has a 32-million-ton target.  The yield averaged 4.62/tons per hectare. 

·        
Ukraine has exported nearly 6.2 million tons of grain since July versus 5.6 million at the same last year, including 2.9 million tons of wheat. 

 

Export
Developments. 

·        
The Philippines bought 165,000 tons of Australian feed wheat and barley for Octo/Nov shipment.  Wheat was bought at $340/ton and barley $287-$289/ton. 

·        
Bangladesh seeks 50,000 tons wheat on September 1.

·        
Pakistan seeks 400,000 tons of wheat on August 23 for Sep/Oct shipment. 

·        
Morocco seeks 363,000 tons of US durum wheat under a tariff import quota on August 24 for shipment by December 31. 

·        
Jordan seeks wheat on Aug 25.

 

Rice/Other

• None reported